Cumulative Tick Indicator with Paintbars for Think or Swim

I’m pretty happy with the cumulative tick indicator now, so I’m graduating it out of “works in progress”. I think it does fairly well identifying which side of the tape to be on, which can be a real sticky point for me. Here’s a plot from the last week or so on a 5 min chart for ES:

The indicator uses paintbars for when the cumulative tick is rising or falling, hence the red or green bars. There are a few whipsaws, but on the whole when the market is trending it picks the right direction to be in. Not a complete trading system, but maybe a useful indicator to build something with. It can have a problem with gaps when looking at a multi-day chart (like with this morning), so watch out there.

The inputs:
Period = The EMA period for averaging the highs and lows of the NYSE Tick.

EMA = The EMA period to apply to the cumulative tick line for smoothing.

Lookback = Number of bars to look back to determine if the smoothed cumulative tick line is rising or falling (rising if current value is above the value X bars ago, vice versa for falling)

UseTrend (yes/no) = This uses the trend correction that I wrote about before, or not

This one is free. You can download the release of my Cumulative Tick Indicator at “Released Thinkscript Studies” on my Google site. If it helps you bank a big trade, feel free to send some my way 🙂

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8 Responses to “Cumulative Tick Indicator with Paintbars for Think or Swim”

  1. forex-cat Says:

    Hi. I am forex-cat.

    Your article is always useful.
    Thanks.

    Good luck trading today.

    …my blog:
    http://forex-chart-analysis-and-a-cat.blogspot.com/

  2. KumoBob Says:

    I like your Cumulative Tick study, and hope you don’t mind but I’ve changed the way it presents.

    http://screencast.com/t/MWIwYmQxYzM

    # Cumulative_Tick_Indicator_R2V2
    # R1V1 May 1 2010 written by Read the Prospectus
    # https://readtheprospectus.wordpress.com/2010/05/05/cumulative-tick-indicator-with-paintbars-for-think-or-swim/
    # R2V1 May 5 2010 – Embellished by KumoBob
    # Added control over the CumTick and NetTick plots
    # Added Arrows
    # Added Option to turn AssignPriceColor On and Off.
    # R2V2 May 6 2010 – KumoBob
    # Reversered all changes and made two line plot
    # with above zero color and crossover color and Arrows.
    # Kept the Arrrows

    declare lower;
    input ColorPrice = Yes;
    input period = 20;
    input ema = 20;
    input lookback = 4;

    def p = period;
    def i = barNumber();
    def na = double.nan;
    input usetrend={default”No”, “Yes”};
    rec htick = if IsNaN(high(“$TICK”)) then htick[1] else high(“$TICK”) ;
    rec ltick = if IsNaN(low(“$TICK”)) then ltick[1] else low(“$TICK”);
    rec avgh = if i == 1 then htick else avgh[1] + 2 / (p + 1) * (htick – avgh[1]);
    rec avgl = if i == 1 then ltick else avgl[1] + 2 / (p + 1) * (ltick – avgl[1]);

    def hi = high(“$TICK”);
    def lo = low(“$TICK”);
    def Last = if isnaN(close(“$TICK”)[-1]) then close(“$TICK”) else double.nan;
    def ahi=avgh;
    def alo=avgl;
    def amean=(avgh+avgl)/2;
    def trendmean=if usetrend AND (htick>avgh OR ltick avgh then htick – avgh else 0;
    def bear = if ltick cumtick[lookback] then color.green else color.red);

    nettick.AssignValueColor(if nettick >0 then color.yellow else color.cyan);
    assignpriceColor(if ColorPrice and cumtick > cumtick[lookback] then color.green else if ColorPrice and cumtick cumtick[lookback] ) then cumtick else double.nan;
    ArrowsUp.SetPaintingStrategy(PaintingStrategy.Arrow_Up);
    ArrowsUp.SetLineWeight(2);
    ArrowsUp.AssignValueColor(color.UPTICK);

    plot ArrowsDown = if Crossover(yes, cumtick < cumtick[lookback]) then cumtick else Double.nan;
    ArrowsDown.SetPaintingStrategy(PaintingStrategy.Arrow_Down);
    ArrowsDown.SetLineWeight(2);
    ArrowsDown.AssignValueColor(color.DOWNTICK);

  3. Prospectus Says:

    Sure, looks good! Are those yellow and green trend channels drawn automatically?

  4. KumoBob Says:

    There is a way to make those lines automatically with AddVerticalLine() but I did those manually. Those were actually left over from a test I did in a different time frame. I did not notice that I had left them on the chart.

    You just gave me an idea!
    -Bob

  5. KumoBob Says:

    Sorry I thought you were talking about the time lines. The yellow and green lines are Andrews Pitchforks. They are in your drawing tools. near the bottom.

  6. Cumulative Tick Indicator with Paintbars for Think or Swim » ThinkOrSwim | marketHEIST.com Says:

    […] Continue to Cumulative Tick Indicator with Paintbars for Think or Swim […]

  7. Cumulative Tick Chart for 5-17-2010 « Read the Prospectus Says:

    […] for 5-17-2010 By Prospectus Look at this 5-min chart for the last two days in ES. It has my cumulative tick indicator on it, which is continuing to impress me in how it picks the right direction in the markets. […]

  8. Cumulative Tick Study (v2) for Think or Swim « Read the Prospectus Says:

    […] the v2 for my cumulative tick study. See the prior post for the full explanation of what it is doing and […]

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